Move is as expected
- The decision was unanimous
- raise the rates because certain risks to inflation have started to materialize which could affect convergence to inflation goal
- balance of risk to inflation has deteriorated though with upward bias in an environment of high uncertainty
- will be vigilant on relative monetary policy stance with US and output gap
- balance of risks to growth maintains downside bias
- peso could appreciate if NAFTA negotiations turn out to be favorable
- convergence to 3% target will be slower than previously anticipated
- further depreciation in exchange rates and pressures on fuel and gas prices would affect downward inflation trend
- impact of US and Mexican tit-for-tat Inflation will be limited and of short duration
- board will act quickly and firmly to factors that imply a risk to prices and inflation expectations
- CPI risks include US dollar, NAFTA, election
- downside CPI risks include favorable NAFTA talks
- unit labor costs could exert pressure on CPI
- risks of upward energy price, agricultural pressures
- economy is still expected to face complex environment
- economy better position to cope with bad scenario
- sustainable public finance consolidation needed
- balance of risks to growth keeps downside bias
The USDMXN has moved to a new session low (but just barely so far). The 20.2161-20.2446 area is the next target. The 200 bar MA (green line) comes in at 20.000 area.
